The number of employers embracing the self-insured model continues to increase, as more employers recognize the need to have more control over their total healthcare costs. In the self-insured model, an employer takes on the responsibility for medical claims and pays them when they occur rather than paying an insurance premium in advance to help cover the costs.
There are a few key players in the self-insured market, and it’s important for companies considering a switch to understand who is involved.
Some insurance brokers specialize in the self-insured market and will help connect an organization to an insurance company and pharmacy benefits manager to process and manage their claims. They can also guide companies in selecting stop-loss insurance that helps protect them in the event of significant claims.
Most brokers have existing relationships with third-party administrators and pharmacy benefits managers that they will recommend to their clients. However, if a broker only ever recommends one company, it may not be the best fit for a company who wants the flexibility and choice available with self-funded insurance.
While an organization could manage their medical claims entirely in-house, many utilize a third party administrator to oversee the self-insured plan and process medical claims. In many cases, major insurance companies own the third party administration companies, who in turn have strong relationships with the larger pharmacy benefits managers in the market.
While this approach may be the right fit for some self-insured companies, it often doesn’t offer the range of choice and control that many mid-size and small companies are seeking when they self insure.
Pharmacy benefits manager
The pharmacy benefits manager (PBM) for a self-funded plan oversees all of the prescription claims for a company’s employees. In consultation with the company, they set the prices on generic, branded, preferred, and specialty drugs for each company’s plan.
Self-insured companies have a choice in selecting their PBM, although many don’t realize it because their PBM may be bundled through their insurance broker or third party administrator. But prescription costs are a significant amount of a company’s total healthcare spending, and it’s important that a company understand what they’re paying for when it comes to prescriptions.
Not all PBMs value transparency, but MaxCare does. We’ll walk you through every step of the process so you fully understand what you’re paying for and why when it comes to prescription medications. We also offer additional value through our clinical services team to help ensure your employees receive the right prescription therapies while also controlling costs.
Thinking about making the switch to the self-insured model? Contact MaxCare today to discuss your pharmacy benefits.